Quick grip:
- Litecoin shows a bullish divergence between the daily active addresses and the price
- LTC shows a maximum of 3 months in terms of address activity compared to its current price
- Litecoin’s MimbleWimble protocol is slated to launch on its testnet this month
- LTC could be preparing for an upward push due to the impact of confidential transactions on crypto-verse
The cryptocurrency markets are in a state of relative calm after what seemed like an endless week of losses. The month of September began with comfortable Litecoin trading above $ 60 before a downward spiral that saw LTC test the $ 45 support zone on several occasions.
Litecoin’s daily active faces suggestion of a bullish divergence
Despite the market turmoil, activity on the Litecoin network continued to be remarkably high. According to the Santiment team, Litecoin shows a maximum of 3 months in the divergence of the address business from its current price level of around $ 48. The Santiment team shared this observation via the following tweet.
https://t.co/qDyuURZs8c
1) The often deleted $ LTC shows a maximum of about 3 months in the divergence of the address business from its current price level. #Litecoin, commonly known for leading the way earlier $ BTC price increase, is currently + 131% above its expected average level at the present time pic.twitter.com/n4ea58eaRA
– Santiment (@santimentfeed) 8 September 2020
As has been noted several times with other networks such as Bitcoin, Ethereum and ChainLink, the price of the coin or token depends on the activity of the network (Metcalfe’s Law). In the case of Litecoin, a divergence between daily active addresses and price could foreshadow a possible push up by LTC in the cryptocurrency markets in the days or weeks to come.
Litecoin’s fundamentals remain strong
Litecoin’s high network activity was also captured by David Schwartz, project director of the Litecoin Foundation. In a recent tweet, Mr. Schwartz explained that Litecoin’s fundamentals are currently very strong using the following statistics.
It affected the drop in prices #LTCfundamental?
No.
280 Thash / S
83k active portfolios
40k trx
$ 50.58 median trx value
$ 7.8 million sent per hour
All in the last 24 hours
It’s a currency, folks. People use it to pay for things.
MimbleWimble will soon be launched on Litecoin’s Testnet
Additionally, David Burkett provided his monthly MimbleWimble update in which he said everything was on track for a testnet launch this month.
Everything is on track for a testnet release later this month. I’m still trying to figure out some final details, but I’ll share more information later this month about what the testnet will look like and how everyone can get involved.
Conclusion
In summary, Litecoin’s network activity is currently showing a bullish divergence with its price. Such a divergence could foreshadow an upward move by LTC in the cryptocurrency markets. With the MimbleWimble protocol being launched on testnet, Litecoin could be preparing for a brief rally due to the positive impact of confidential transactions on the LTC network.
As with all Litecoin analysis, traders and investors are advised to use adequate stop loss and low leverage when trading LTC on various derivative platforms.
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